Springs, Pueblo agree to 20-year, $460 million pact

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The cost of deferred maintenance came into sharp focus Monday when Pueblo County and the city of Colorado Springs announced a 20-year, $460million deal to correct the Springs' neglected flood-control system and pave the way for good relations over activating Springs Utilities' $825million water pipeline from Pueblo Reservoir.

The agreement will cost the city an average of $23 million a year — 53 percent more than the $15.2 million raised by the city's previous Stormwater Enterprise fee. The fee, adopted in 2007, was abolished in 2009 to comply with Issue 300, a ballot measure mounted by anti-tax activist Douglas Bruce as a way to end the "rain tax." That action infuriated Pueblo County, which issued a construction permit in April 2009 for the Southern Delivery System pipeline in part on spending made possible by the stormwater fee.

Now, the city will pay considerably more.

"This IGA requires Colorado Springs to commit much more than [the Stormwater Enterprise] for stormwater mitigation to address the past practices of overlooking the stormwater problems and to address future issues," Pueblo County Commissioner Sal Pace said in a release.

Mayor John Suthers told City Council on Monday it's the city's problem "regardless of the level of public support." Besides opposing the enterprise in 2009, voters in 2014 rejected a regional drainage authority and fees, a measure opposed by former Mayor Steve Bach.

"This is not a problem that those of us in this room created," Suthers said. "I'm not going to point fingers. But the fact of the matter is, it's a problem we inherited. It's a problem we have to deal with."

He also noted that while city general funds and Springs Utilities rates will fund the agreement, nothing precludes developing a different funding source, such as fees or special taxes. Suthers also pointed out the IGA will "go a long way" toward resolving negotiations with the Justice Department over the city's 2013 and 2015 Clean Water Act violations, which could bring fines and/or a court decree mandating levels of spending.

As outlined by Pueblo County, the intergovernmental agreement's terms:

• Colorado Springs will spend $460 million during the next 20 years on 71 stormwater projects.

• If those projects aren't finished by 2035, the IGA renews for five years at another $26 million per year.

• Pueblo County will play a "significant role" in timing, prioritization, selection and verification of mandated projects under a "strong mechanism for enforcement."

• Utilities will pay the city of Pueblo $3 million ($1 million a year for three years) to protect its levees, in addition to $2.2 million already paid for that. But the money must be spent in the year in which it's given, said David Robbins, outside attorney representing the Springs.

• Utilities also will make a one-time $125,000 payment to the Fountain Creek Watershed, Flood Control and Greenway District to help fund operations and studies, including whether to dam Fountain Creek.

• Utilities' previously agreed-to payments to the Fountain district of $50 million over five years will be accelerated; the first payment of $9.6 million is due within 30 days of IGA approval. Then, four equal payments of $10 million will be made annually starting in January 2017. The money will fund erosion and flood control.

While the IGA's funding is subject to annual appropriations in compliance with the Taxpayer's Bill of Rights, the IGA is guaranteed by the Utilities enterprise, which can commit to a multi-year agreement, a city spokeswoman says.

Council and Pueblo County commissioners are expected to approve the IGA in coming weeks in advance of the April 27 scheduled activation of SDS.